Corporate governance

Dr. Sulaiman Al Habib Medical Services Group Company adheres to the highest standards of corporate governance and applies all the applicable provisions contained in the Corporate Governance Regulations issued by the Capital Market Authority and other related laws and regulations, as well as principles of international governance best practices, where applicable.

The Group has established a governance framework that includes regulations and policies that promote transparency, accountability and competence guided by the Corporate Governance Regulations issued by the Capital Market Authority. The Group continuously updates the corporate governance framework when needed based on any amendments to regulations, global regulations or practices, and all related stakeholders such as board members, executive management and employees shall adhere to the corporate governance policies to protect the interests of the Company and other related parties.

In line with the existing and newly developed financial, economic and investment legislation system in the Kingdom, the Board of Directors has formed three committees to assist it in performing its duties, in addition to the audit committee formed by the general assembly of the Company. The following are the formed committees in the Group:

• Audit Committee
• Executive Committee
• Nomination and Remuneration Committee
• Patient Safety and Quality of Care Committee

In line with the Company objective to set adequate procedures, controls and systems that would enable the Company to achieve good governance that ensures systems of a control and accountability in relation to the activities of the Company and its employees in a manner commensurates with the risks involved in these activities, and in implementation and in compliance with the corporate governance regulations and other related laws and regulations in addition to the principles of international governance and best practices, the Company's Ordinary General Assembly and /or the Board of Directors have adopted and approved the following, policies and regulations:

• Audit Committee Charter.
• Nominations and Remuneration Committee Charter.
• Remuneration Policy for Board, Committees, and Executive Management.
• Policies, Standards and Procedures for Board Membership.
• Patient Safety and Quality of Care Committee Charter.
• Executive Committee Charter.
• Board of Directors Charter
• Conflict of Interest Policy.
• Internal Audit Operational Manual.
• Related Parties Transactions Manual.
• Transparency and Disclosure Policy.
• Investor Relations Manual.
• Shareholders' Manual.
• Code of Conduct.
• Social Responsibility Policy.

Compliance program:

High standards of trust and integrity between the Group and its clients are a top priority. They are among the most important pillars upon which the Group builds its reputation amongst its clients and stakeholders. The protection of this reputation in all activities carried out by the Group must be firmly rooted in the minds of the Group’s personnel. This requires them to have a high level of trust, integrity and professionalism while carrying out the tasks assigned to them, and their behaviors must be committed to the letter and spirit of the laws, regulations and instructions governing the Group’s activity.

The Compliance Program is a practice driven to enhance the application of good governance that was implemented in the Group. The compliance division carries out an independent function of identifying and assessing the risks of non-compliance with laws, regulations, standards and the Group’s policies, providing advice and guidance, monitoring and preparing reports on compliance and potential risks to the Group as a result of its failure to comply with the applicable laws, regulations, Code of Conduct and sound standards and practices, and submitting these reports to the competent departments in the Group. The compliance function is one of the most important factors for the success of the Group, since it plays a key role in maintaining its reputation, credibility and client interests and providing protection against penalties.

In application of best practices, the Group's employees are required to disclose, via an electronic form, cases of conflict of interest annually. Further, group employees can report anonymously any unethical or unlawful incidents or activities via an electronic form to the Compliance division, and they are investigated in a manner that ensures the confidentiality of the reporter in accordance with the approved whistleblowing policy. Also, the current and new employees of the Group are required to familiarize themselves with the rules of Code of Conduct and review them annually, and the Group also trains employees annually on commitment and professional ethics, where the rules of Code of Conduct and the whistleblowing policy are duly explained to ensure their application.